Understanding Sick Leave Compensation: Guidelines and Regulations

Sick leave plays a vital role in employment, ensuring that individuals receive support during temporary work incapacity due to medical reasons or other circumstances specified by the Law on Mandatory Health Insurance. This article sheds light on factors determining sick leave compensation, especially concerning the Croatian context.

The basis for Calculating Sick Leave Compensation

Sick leave compensation is a right extended to specific insured individuals under mandatory health insurance. To access this compensation, one must meet the specific conditions outlined by the Law and the Croatian Institute for Health Insurance (HZZO) general regulations.

The Law on Labor governs the compensation for periods when an employee cannot work for legitimate reasons. These can stem from legal provisions, collective agreements, work regulations, or employment contracts. The duration of leave and the resulting compensation depend on various factors, including legal requirements, collective agreements, or work regulations.

Determining Compensation Amounts

Several factors come into play when establishing the amount of sick leave compensation. The most crucial step is to identify the basis for calculating the compensation. Once you’ve installed the base, you can determine the payment amount.

The average monthly wage earned in the preceding three months is the foundation for sick leave compensation. However, if an individual has not received a salary during this period, the payment is calculated based on what they would have earned had they been working.

Calculation Methods and Exceptions

In acknowledged work-related injuries or professional illnesses, where it’s impossible to determine the average wage, the compensation basis becomes the wage from the month the right to compensation emerges.

The compensation amount for sickness-related leave compensated by HZZO is determined based on the average wage of the last six months before the incident. This applies irrespective of whether it’s the employer’s responsibility unless specified otherwise by specific legislation.

The manner of calculating sick leave compensation, mainly when the employer covers it, isn’t explicitly defined by the Law on Health Protection. Instead, the collective agreements, work regulations, or employment contracts that bind the employer determine the method.

Special Considerations for Compensation Calculation

When the preceding six months fail to determine a precise average wage, the compensation basis shifts to the wage paid up to the day of the incident or the corresponding month for which they calculate the compensation.

However, in temporary incapacity for work, the compensation amount can’t fall below 70% of the compensation basis.

Certain types of payments are excluded from the calculation of the compensation basis, such as those related to pensions, obligatory health insurance, rewards, bonuses, and more. Also, non-monetary bonuses aren’t considered part of the compensation calculation.

Final Thoughts

Navigating the intricacies of sick leave compensation can be complex. Understanding the basis for compensation calculation, exceptions, and regulations ensures that employees and employers know their rights and responsibilities satisfactorily.